Important events today:

07:00 UTC – GBP – GDP Volume Change

The strengthening of the US Dollar following the release of US Consumer Price Index (CPI) data for February is driving the major pair lower.

US inflation, as measured by the Consumer Price Index, rose 0.4% m/m and 3.2% y/y in February, the Bureau of Labor Statistics reported on Tuesday. The monthly CPI reading was in line with expectations, while the annualized rate was above the market consensus of 3.1%. The core consumer price index, which excludes volatile food and energy prices, rose 0.4% for the month and 3.8% for the year, beating forecasts.

On Thursday, investors will focus on retail sales data for February, which is expected to rise 0.8% from the previous month. Strong retail sales data could trigger a further reassessment of expectations following February’s CPI inflation report.

On Tuesday, the Office for National Statistics (ONS) released data showing that the annual rate of wage growth in the UK is falling. The measure of average earnings in the UK from November last year to January 2024 fell to 5.6% from 5.8% in the previous reading, while annual wage growth fell to 6.1% from 6.2% previously.

Investors are awaiting UK GDP growth data for January, which is forecast to increase by 0.2% m/m.

Recommendations: Trade Buy orders when reaching from the price level of 1.2820. Sell at the price level of 1.2710